Estimates Committee

By : Neha Dhyani

Updated : Apr 6, 2022, 7:07

It is always important for a country to scrutinise its monetary flow in order to achieve a sustainable goal of development. The Estimates Committee is a governmental approach to monitoring the funds' flow in different ministries and departments in order to achieve economic betterment. This committee is appointed by the Indian parliament, and the members of Parliament elect the candidates to represent it. There are 30 parliamentarians in the committee who are appointed for one year to perform their duties as being a part of the Estimates Committee.

The decision to establish the Estimates Committee in order to promote better scrutiny of fund flow within different ministries was taken under the recommendation of finance minister John Mathai in the year 1950.

Estimates Committee - Functions And Challenges

The Estimates Committee has brought numerous beneficial aspects to the Indian economic system, ensuring scrutinised financial flow. This governmental approach is bound to inspect the effects of budget estimates on economic growth.

The Estimates Committee also examines the administrative structure of different ministries, emphasising the process of fund usage. If the monetary flow violates the governmental policies, the Estimates Committee takes action to improve the administrative structure, thus improving the efficiency of the governmental sectors. Despite having numerous advantageous factors, the Estimates Committee also possesses some limitations that can hinder its efficiency in achieving the optimum goal of economic growth.

The Estimates Committee has been given the power to analyse the budget estimates. But this power is applicable only after the budget is attained. The parliament of India has vested no power in the committee to ask counter questions about the policies taken by the government. It means the committee gets to take its action within the territory of governmental autocracy.

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Estimates Committee - Historical Background

This committee has its roots in the pre-independence era, with the establishment of a standing finance committee in 1921. Later, during the post-independence period, finance minister John Mathai recommended the foundation of the committee. In 1950, the committee was ultimately created.

Estimates Committee Composition

  • The committee began with 25 Loksabha parliamentarians and was expanded to 30 members in 1956. No Rajyasabha member is eligible to be a member of this committee.
  • The members of the Estimates Committee are elected on an annual basis. However, no representative of any government ministry can be a part of it.

Estimates Committee - Measures to Overcome the Challenges

  • If the government's proposed investments are evaluated prior to voting, the expenditures will be reduced to some amount.
  • The committee's recommendations and judgements should be binding in nature as it assesses whether the money is fairly distributed.
  • The formation of subcommittees under the supervision of the estimate committee's governing body may be a better way to keep track of the enormous monetary components of several ministries.
  • A professional person should be hired to assist the Estimates Committee in evaluating the budget.

It can be concluded that the Estimates Committee plays an important role in economic growth by ensuring effective scrutiny of the budget estimates. Although the committee does not get permission to scrutinise every department's monetary flow each year, Hence, the scrutiny of different departments' monetary flows takes years to evaluate.

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FAQs on Estimates Committee

Q.1. What is the Estimates Committee?

The parliament of India, which is also known as the Lok Sabha, employs the Estimates Committee to monitor the process of channelization of funds executed by different government ministries for different purposes. This body also plays an important role in recommending the government ministries and departments to utilise the government funds in an effective way to achieve the optimum development of the country.

Q.2. Who runs the Estimates Committee?

The parliament of India elects 30 people who are already a part of parliament to represent the Estimates Committee. The principle of proportional representation is used here to execute the election process. Although a person who already represents a ministry cannot be a candidate.

Q.3. For how long is the Estimates Committee appointed?

The Estimates Committee is employed by the Indian Parliament to carry on its duties for one year.

Q.4. Who gets to be the chairman of the Estimates Committee?

The chairman of the Estimates Committee is selected and appointed by the speaker of the Lok Sabha of India. The main criteria for being the chairman of the Estimates Committee is that the person needs to be a member of the ruling party.